Ripple takes the lead when it reaches an agreement with the Central Bank of Bhutan to run a pilot CBDC program in the country.
Bhutan launches CBDC pilot program
Through a September 22 posting on its website, Ripple announced that the Royal Monetary Authority (RMA) of Bhutan had partnered with him to experiment with the CBDC (Central Bank Issued Digital Currency). Ripple will provide its blockchain-based CBDC services to Bhutan, issue digital currencies to central banks in developing countries, and run a pilot program.
According to the statement, the purpose of the possible inclusion of CBDC in countries’ financial infrastructures is to streamline transactions by increasing the percentage of adults with bank accounts from the current 67% to 85% by 2023. With Ripple’s CBDC ecosystem, the country will drive retail, wholesale and cross-border use cases of Bhutan’s digital currency: Digital Ngultrum.
Ripple’s CBDC ecosystem
Bhutan is the second country to join since Ripple announced in March that it would be running similar CBDC pilot programs. The Brazilian central bank had previously announced a CBDC pilot program in June.
Ripple uses XRP private ledgers to build and operate CBDC. XRP Private Ledger is based on the same blockchain technology that XRP Public Ledger (XRPL) works on. In addition, both ledgers use Ripple’s native XRP token. Ripple says that XRP Private Ledger enables central banks “to access a network of CBDC ledgers that allows full interoperability in settlement while ensuring monetary and technological independence.”
Ripple takes the lead
A recent study by the BIS (Bank of International Settlements) shows that 14% of central banks are launching pilot programs, 60% are experimenting with the technology and 86% are researching CBDCS.
Right now, Ripple appears to be taking the lead in emerging markets by being the first to support CBDC pilot programs.